THE WAIT-AND-SEE GAME OF WIRELESS

By: Sarah J. Heim Jupiter Research Releases Study


(Adweek IQ) Winning
the race of developing content for the burgeoning U.S. wireless sector means
taking things slow and steady, according to a Jupiter Research report released
Monday.

The research, led by analyst Dylan Brooks, cautions that companies with business
models dependent on significant wireless advertising or subscription revenues
should not immediately invest heavily in wireless development.

A primary issue that was glossed over in the blitz of wireless hype during the
past year was the fact that just because wireless connectivity may allow for
greater reach, it doesn't necessarily afford greater potential revenue, Brooks
said.

"There's something to be said for taking a modest approach to developing right
now," he added. "It's a little like playing a wait-and-see game."

Although advertising, subscription, and transaction revenue are now nearly
nonexistent across wireless platforms in the United States, New York-based
Jupiter's research projects $330 million in combined wireless subscription and
advertising revenue by 2003.

While a modest amount compared to traditional outlets, the figure still suggests
that there is room for long-term success for businesses entering the wireless
marketplace.

In fact, the report found that wireless advertising will be the biggest near-
term revenue source for wireless content providers in the United States,
assuming advertisers and marketers overcome hurdles such as lack of reach,
poorly designed interfaces and privacy concerns.

Tapping into the growing segments of syndicated content and premium paid content
are going to be key for wireless companies going forward, Brooks said. The
research also found that, although it would be financially beneficial for them,
wireless companies should not expect to share in a carrier's per-minute
revenues.

Sharon Knitter, director of new platforms for Tribune Interactive, said in the
future she expects there will be small charges for very targeted wireless
content from Tribune's 18 sites - like geographically specific real estate
listings.

She also said that by establishing key relationships with large carriers such as
AT&T, and wireless services providers 2Roam and Vindigo, the company is
preparing for a future when the perils of accessing mobile devices and reliance
on the PC have decreased.

Companies like the New York mobile software firm Vindigo, which developed ad-
supported city guides accessible from PDAs, offer publishers a way to take the
first step toward going wireless - or at least mobile, for now. Vindigo
takes a publisher's existing content - such as shopping, restaurant and
entertainment listings - and puts them directly on a user's PDA.

At this point, all of the publisher's content resides on the device. However,
Vindigo's next generation product will have enhanced wireless apps. Vindigo
currently has more than 400,000 registered users and publishing partners in all
the major metropolitan U.S. cities.

Jupiter cited Vindigo as an example of "best-practice" in context-driven
development. "For companies like Vindigo," Brooks said, "the question becomes
not only how many total users you can touch, but exactly what these people are
doing with your services and how much value you can deliver to advertisers."



Copyright 2001, Editor & Publisher.